89 points - today at 12:27 PM
today at 2:10 PM
Following the public reporting timeline of builder.ai lays out a fascinating story akin to Theranos or Wework. I'm sure we'll get an exhaustive account of exactly what happen in due course, and there will likely be other such cases that come out of the most recent AI investing boom.
Aug 2019 - WSJ report that for builder.ai the "AI" means "Actually people in India"
https://www.wsj.com/articles/ai-startup-boom-raises-question...
FT pick up the trail over a year ago with a series of reports:
Mar 2024 - Men behind builder.ai named in criminal probe
https://www.ft.com/content/7ff3c5fc-e390-4ca8-9c7d-11fd56ab7...
Mar 2024 - The wild ride of a Microsoft-backed tech unicorn
This is a full detailed profile of the CEO and the company detailing their wild spending and fundraising details:
https://www.ft.com/content/11afc46c-b435-489d-a9f1-134ad0c00...
It all falls apart after that report:
May 2024 - CEO steps down
https://www.ft.com/content/f8882c90-ef69-4a62-aecf-9d3725aca...
May 2024 - builder.ai finds auditor had links to previous CEO:
https://www.ft.com/content/26c98590-e8f9-4cd9-83d6-db0d25ad2...
Apr 2025 - builder.ai restates revenues and hires outside auditors to investigate inflated sales
https://www.bloomberg.com/news/articles/2025-03-31/microsoft...
and this week they folded. The website was up 48 hours ago last I checked, but has now been taken down.
today at 1:26 PM
From earlier this year:
> A partner at accounting firm PKF Littlejohn signed off the UK accounts of the artificial intelligence start-up, despite having previously served as a director of another company also set up by Builder.ai’s founder, Sachin Dev Duggal, according to a review of hundreds of filings analysed by the Financial Times.
https://archive.ph/qdUFD
today at 1:33 PM
I wonder how many of these hype-chasing AI founders are going to take the path of self-enrichment while capitulating their startups when they get exhausted of searching for a moat.
today at 3:39 PM
I wonder how many of these hype-chasing AI founders are NOT going to take the path of self-enrichment while capitulating their startups when they get exhausted of pretending to build something.
today at 1:48 PM
All of them
today at 2:09 PM
That is indeed the song of venture capital.
today at 2:03 PM
And there are already so many companies with an existing moat that could go into this space with their existing user base.
today at 2:04 PM
> of these hype-chasing AI founders [...]
I mean, if you qualify that question like that, then probably closer to 100%.
What would be more interesting to know, is how many AI founders starts out as "not hype-chasing", but end up self-enriching/capitulate their startups regardless, basically turning into it rather than starting out like that.
today at 3:29 PM
How do I get into this game? Take a bunch of VC money, pay myself a hefty salary, don't give a damn about my employees if the whole thing goes bust. Must be nice, not having principles.
today at 4:56 PM
Start here: https://admission.stanford.edu/apply/
today at 2:02 PM
https://www.ey.com/en_gl/weoy/class-of-2024/united-kingdom
today at 3:21 PM
I don’t think this is necessarily as sinister as you say - another way to right that paragraph is “successful accountant who has a history with AI companies does accounting”
today at 1:21 PM
We will see more and more AI startups running out of money soon. I know of a handful of similar 100m+ raised companies that have no product to speak of and are just cruising towards their end.
today at 1:51 PM
Hopefully it's a sign of the bubble starting to pop. This is the same situation we had in the late 90s with the dot-com bubble. Many companies built on hype with lackluster products. So much so that it became a meme with zombo.com. We need an AI-bubble equivalent parody product.
today at 2:18 PM
Anything is possible at ZomboCom, You can do anything at ZomboCom.
Seems to be covered already!
today at 2:33 PM
Oh man, I forgot about ZomboCom
You're right. It would be a prime time to launch ZombAI
today at 6:19 PM
ZomboCom has outlived five or six bubbles by my count, and still as good as ever!
today at 4:38 PM
Don't be silly. Just because the Crypto/Blockchain promises of grandeur turned out to be mostly nothing, and the "fuck regulation, we are all the <hotel, taxi driver, you name it>" "gig economy" companies are losing customers as they show their true colours, and the AI bubble starts to burst, that doesn't mean that over-hyped niche "technologies" can't rake in millions of some poor VC investors money.
It just requires lateral thought.
Pay the completely untrained gig-workers peanuts to review AI written code to create a universal blockchain "bank without borders". I mean what could possibly go wrong?
today at 6:50 PM
To push back at your obvious facetiousness, I do think that both cryptocurrencies and machine learning are very powerful and useful technologies. Underneath the scammers, grifters and investors that jump on the hype train for their get-rich-quick schemes, and the general public that falls for it and fuels the hype train, both technologies have solid reasons for existing, and can be generally very useful to humanity.
So I reject the notion of throwing the baby out with the bath water as much as the hype bubble around them.
What we do need, as with any novel technology, is oversight and regulation. Which is difficult this time around when the grifters are also the ones in power.
today at 1:39 PM
When the dominoes start to fall, perhaps it’d be helpful to post a public list of existing / existed AI firms with brief descriptions, timespan of operation, capital / investments publicly known, and give a reference point for historical sake. The startup sector being quite diverse, one specifically for AI could be interesting…as in context for all the “problems” and “benefits” AI was going to solve but failed and burned money in the process.
today at 1:43 PM
Somebody needs to bring back Fucked Company for AI companies.
today at 1:49 PM
Can we bring back Webshit Weekly while we're at it? RIP n-gate, you would have loved talking shit about AI companies.
today at 2:06 PM
I'm sure an LLM would be up to the task of shit talking as a service. All the big models are probably trained on all of n-gate already. With a bit of high quality prompt engineering as your moat, raising a few million shouldn't be too arduous.
today at 1:56 PM
That blog aged very well
> TikTok (business model: "Uber for Vine") is more popular than Facebook (business model: "Uber for Sino-Soviet Propaganda"), presumably because it bypasses the middleman and delivers the content straight from the source. Hackernews debates whether it's just a matter of time before it turns out to be evil, or whether a social-media application targeted at children and operated by a government full of genocidal monsters is and shall remain "fun." Other Hackernews point out that the app, which is operated by a company in which the murderous, barbaric Chinese government has an ownership stake, is mean to fat people.
> Github (business model: "Uber for README.MD") directs its employees to eat its own dog food. Because of Github's acquisition by Microsoft (business model: "Uber for customer abuse"), it turns out that what Github engineers are eating came out of the dog to begin with. Hackernews tries to figure out whether they, as customers of Microsoft's latest desperate attempt to get anyone to use Azure, have any control over their information, or whether they'd be better off remaining with their existing workstation-as-a-service provider, Apple (business model: "Uber for garden walls").
today at 2:14 PM
The prose makes my head hurt. Horribly written.
today at 1:40 PM
Might as well start building that list here
today at 2:21 PM
[dead]
today at 3:47 PM
This is my "hot take" as well.
My genuine question--outside of programming-related use-cases (which are remarkable), what has come out of the generative AI "boom" that's a profitable product, or has a viable path to profitability?
What "business transformation" has happened in the private sector as a result of "agents" or whatever? What companies look promising (don't say another VSC fork)?
today at 6:00 PM
A lot more customer support seems to be handled by chat bots these days. For support that has migrated from humans to chatbots, I assume it's a poorer but cheaper implementation. For support that has migrated from older chatbots (that seemed to base their answers on regexes or some weird branching logic), maybe it's an improvement?
I'm not into this space, but I also assume that translation work is moving from a writing to an editing job, since an LLM can do that pretty well. I just had an LLM correcting my German mistakes for an email I had to send today.
I'm also not sure that profitability is relevant just yet, as inference costs keep going down. Programming-related use-cases do encompass a lot of why GenAI is useful, simply because they make anyone able to write their mothertongue a programmer. It's fine if LLM-based products bootstrap with high-margin industries like tech, and move into thinner margin ones as costs go down. Of course I'm also not saying the current valuations and hype are justified (I don't know).
today at 3:32 PM
isn't this normal for any new emerging market?
today at 5:34 PM
Depends! but Their selling the coming to investors on hopes of reinviting something that is already there. The data they're using isn't owned by them. All of these " unicorn " wanna be's are wasting investors money. This will be the norm for the upcoming years. Regulations are driving these AI companies to divert their efforts to something less substantial. First regulations has to be aligned with the goals of tech and see where this direction will head.
today at 1:25 PM
Even a financially responsible (and I’m not suggesting Builder.ai is one of these) company in the AI space is going to be significantly more capital intensive than your typical SaaS startup, and I suspect are fundamentally more challenging to operate.
today at 3:02 PM
SaaS companies tended to need material engineering resource due to the software stacks and squad-style team structures in place -- also leaned heavily on costly metered infra
I'm not seeing anything like the same level of heads or stack complexity in this wave (Vercel, Firebase etc.), and the vendors involved get cheaper every day ... along with increasing ability to run models locally with no metered costs at all
today at 3:09 PM
How?
Now you need to deal with all the traditional infra, plus a bunch of specific infra dealing with LLM apps, even if you’re just a wrapper using vendor APIs.
How are things in any way simplified? I only see more layers of complexity.
Look at all the great unsustainable AI applications we're never going to be able to use.
I think the big and juicy AI applications are just so that GPUs can go brrrr[1]. Just gimmicks.
Real and useful applications will come from SLM that can be run on SoC like phones or Raspberry PIs and LLMs optimized to run on consumer grade hardware like the 3060s, not with those models that require multimillion dollar setups to be able to run.
[1] https://news.ycombinator.com/item?id=40337936
today at 2:11 PM
[flagged]
today at 2:20 PM
I, as a human, enjoyed the flavor of this phrase, and I applaud this stylistic choice.
today at 2:26 PM
You mean talk like an ai?
today at 2:25 PM
today at 12:27 PM
https://archive.ph/T5ean
today at 1:19 PM
Absolutely baffles me how you can blow $500m on a website builder without anyone noticing.
What the hell happened? Unless it was an actual defrauding of investors, but how were the investors so stupid?
today at 1:50 PM
Some people have so much money they don't mind investing 10-100m here and there in the hope of making a 10x return. Greed and hype explains a lot of the juicero type of investments.
It says a lot when public services are deteriorating pretty much everywhere while investors blow hundred millions on fruit pressing machines and LLM wrappers
The public services are deteriorating because that's what the people are voting for.
today at 2:39 PM
What do you mean by this? Do you mean in the UK, where this company was based.
How are UK citizens voting for deteriorating services?
today at 3:12 PM
Did you miss the Brexit thing?
Could that be because 99% of mass medias who make or break politicians are owned by a small elite of hardcore capitalists who have their own interests in mind?
Democracy isn't just about showing up every few years and putting a name in a ballot, it's a framework that requires a whole bunch of other things. A lot of EU countries and the US are getting closer and closer to oligarchies
today at 3:13 PM
I agree I mean what about all the teachers and the long term impact they have on society? A “little hundred mil” could go a long way.
But, that aside, since I’m just getting into the Lean Startup:
In chapter 12—startups typically need Scarce but Secure Resources:
“too much budget is as harmful as too little—as countless dot-com failures can attest—…”
I suppose this falls under case-and-point. They had too much money and blurring the lines between real customers and early adopters. This whole thing could have probably been figured out for a couple mil I’d imagine (though I’m no expert).
today at 2:54 PM
How can I talk to those people? I have a business that is profitable, but small. And I find it difficult to talk to investors.
today at 3:07 PM
Do you have a plausible path to 10x+ing tens of millions in capital?
Ultimately the business of VC means that you're dealing with people how have a high risk tolerance but need the potential high payout to balance their risk.
If you have a sustainable, profitable, but small business that needs capital to expand, but likely won't grow significantly, you're better off talking to a family office or individual investors. I'd avoid banks if you can help it.
If you actually do think you have a plausible VC investment then it's a game of networking. Go through every person you know and look for someone who knows someone who can give you an introduction. If all else fails there's cold outreach but those can be difficult. You might need to bring on a partner who can handle that side of things if it's critical to your business.
today at 3:04 PM
Did you go to same university, the same clubs?
Have a look at lot of founders on linkedin. You'll notice a lot go to the same small set of universities, or worked for same companies. Then there's the odd exception. But they're the exception.
Its silly to think talent is actually that concentrated.
I think everybody knows why some people can get investment to literally throw down the drain on insane moon shots, while others struggle to even survive. I'm sure lots of people have moonshot ideas that might work. Only a very small in group get investment.
If you're already profitable, these types of investors will not be interested. They are looking for companies they can take public at massively inflated valuations based on growth projections totally removed from economic reality.
today at 3:05 PM
The orgs investing millions usually aren’t looking to invest small or even profitable most the time.
If there’s a good growth story contact people who write smaller checks who would also be interested in using the product.
today at 3:06 PM
If your networking skills and levels of resourcefulness are such that you're asking random people on HN how to talk to investors, it's very unlikely that any of these investors will invest in you. So the answer is to invest heavily in improving at those two areas.
today at 4:31 PM
Also, some may hope to sell to a greater fool. Which works a lot of the time.
today at 1:24 PM
Perhaps they blew it all on "research" and GPU costs?
The current Gemini canvas implementation is pretty wild and can create you an app or website very very easily. Not as easy as ordering a pizza sure, but still even with just a few iterations you have something truly decent. Occasionally you luck out and the "one shot" is precisely what you want, but that typically requires an extensive prompt so you're beyond pizza range then.
Perhaps they were just too ahead of their time in that regard... But then if they'd waited then Google and OpenAi and Anthropic would have just eaten their lunch anyway (provided Claude was not too busy blackmailing you anyway!)
today at 1:32 PM
nah
https://www.theverge.com/2019/8/14/20805676/engineer-ai-arti...
(same company, before rebranding to builder.ai)
today at 1:36 PM
I mean it's kinda amazing, this was just in 2019 that this company was basically lying about being able to do this to get investment, yet now I can actually do it myself, right now, for free*. Incredible - where will we be in another 5 years?!!!
* - with AIStudio at least...
today at 1:55 PM
> The company’s founder Sachin Dev Duggal (...) retained his board position and title of “chief wizard”.
Flash of the Silicon Valley show.
today at 3:42 PM
The UK has cemented its place in tech as the land without Sarbanes-Oxley.
today at 1:28 PM
Hmmm...criminal CEO plus no product that people need. Who would have guessed this outcome?
today at 2:51 PM
the first domino has fallen, the rest of the industry to follow?
Big tech then swoops in and buys up any _worthwhile_ startup for cheap and consolidation of power continues for tech.
I’m not sure what happened there but I’ve both experienced and seen so many startups where their initial leadership was great, then VC gets involved and completely destroys the long term trajectory of the company in exchange for short term growth.
I genuinely think twitter and LinkedIn has ruined the brains of founders who follow fads after losing the goals and visions they had when they first started.
today at 4:04 PM
There've always been companies that crash and burn chasing unrealistic dreams of future profits. I think what Twitter and LinkedIn have created is the false perception that these kinds of things are representative of the industry. Another recent unicorn startup in the UK is Tripledot Studios, which has much more revenue and has made bigger investment deals than Builder.ai at its peak. But they're in mobile gaming and not AI trendy wave of the future stuff, so you don't hear so much about them.
Until clawbacks as strict banishment enforcement from the ability to serve in corporate governance roles, it’s rather depressing to catch up after the fact and realize there’s nothing particularly stopping these bad actors individuals from profiting and potentially moving on to another shaky, at best, enterprise courting suckers…I mean, investors.
today at 1:27 PM
The entire company and its $500M has been "deleted" [0] over fraud and cooking their books.
A great candidate for the Theranos of AI, even with Microsoft involved as an investor.
We'll see a new wave of fraud(stars) being exposed out of this AI hype.
[0] https://builder.ai
today at 1:38 PM
here's the website from the waybackmachine: https://web.archive.org/web/20250328114320/https://www.build...
look at all the awards and brands!
today at 7:26 PM
Maybe I'm just a bad dev but I'm baffled how they charge $46k for "29 features" and $56k for "43 features"... Straight up guestimations and magic numbers
but then again they also highlight how you don't have to know anything about tech to use them, so I'm sure setting "fixed pricing" for a fixed number of "features" is a great way to snake oil salesman potential customers
today at 1:42 PM
“Assembles your idea like a LEGO set” is pretty blatant trademark infringement too. Clearly it did not work as a LEGO set because those…actually work. Yet another example of startups getting funding whilst blatantly flouting IP ethics, color me not surprised at all.
today at 1:47 PM
Not really a trademark infringement.
today at 1:45 PM
Why is this a big news, didn't we already learn that most startups/companies fail and investors are just betting to find their next unicorn?
contrary to builder.ai, we now have success stories in this area: lovable, cursor, replit agents and so on
> contrary to builder.ai, we now have success stories in this area: lovable, cursor, replit agents and so on
Builder.ai was also a "success" until someone double checked their books and discovered they were inflating their revenue by about 300%. Much to consider.
today at 4:34 PM
It's maybe a bit of a Theranos situation. Not your normal sincere effort that fails.
Are any of those companies profitable?
today at 4:09 PM